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Bombay High Court

PUSAN SHIVRAM SOLANKE. (L.RS.)GOVIND and OTHERS.versusTHE STATE OF MAHARASHTRA and OTHERS.

Disposal
PARTLY ALLOWED AND PARTLY DISMISSED

Holding

The appeal is partly allowed and the compensation is modified to Rs 6,000 per acre (Rs 15,000 per hectare).

Summary

The appellants’ land was acquired in 1994 for a reservoir, with the acquisition notification issued in 1974 and an award in 1976 granting compensation that the claimants accepted under protest. They sought a reference under Section 18 of the Land Acquisition Act to determine proper market value, claiming Rs 8,000 per acre, while the Reference Court fixed Rs 4,000 per acre after applying a 20% deduction for the small size of a 1971 sale transaction. The appellants argued that the 1971 sale price of Rs 5,000 per acre should be escalated by 10% per year for the two‑year gap before the 1974 notification, and that the deduction was excessive. The High Court agreed, holding that a cumulative 20% escalation raises the value to Rs 6,000 per acre (Rs 15,000 per hectare) and awarded interest under Sections 28 and 34 of the Act. Consequently, the appeal was partly allowed, the compensation was modified, and the rest of the award was confirmed.

Issues considered

  • Whether the Reference Court correctly applied a 20% deduction for the small size of the land in the 1971 sale instance.
  • Whether a yearly escalation of 10% should be applied to the 1971 sale price for the period up to the 1974 acquisition notification.
  • What is the appropriate compensation rate per acre/hectare under the Land Acquisition Act, 1894.
  • Whether the claimants are entitled to interest and other statutory benefits under Sections 28 and 34 of the Act.

Legislation cited

Subjects

  • land acquisition
  • compensation
  • market value determination
  • reference court
  • escalation of value
  • interest under Land Acquisition Act
  • statutory benefits

Judgment

2026:BHC-AUG:38230
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                            IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                       BENCH AT AURANGABAD

                                   21 FIRST APPEAL NO. 1088 OF 2007

                        Pusan Shivram Solanke. (l.rs.)govind And Others.
                                              VERSUS
                             The State Of Maharashtra And Others.
                                                  ...
             Advocate for Appellants : Mr. S. V. Mundhe
             AGP for Respondent-State: Mr. B. A. Shinde
                                                  ...
                                  CORAM          : SIDDHESHWAR S. THOMBRE, J.
                                      DATE          : 18.08.2026

             PER COURT :
             1.         As the acquisition proceeding is of the year 1994, the appeal is

             being heard finally with the consent of learned counsel for the respective

             parties.

             2.         By this appeal, the appellants-original claimants are aggrieved by

             the judgment and award dated 7 th February 1995 passed by the learned

             Civil Judge, Senior Division, Hingoli, whereby the learned Reference

             Court enhanced the compensation; however, according to the appellants,

             the compensation awarded is inadequate.

             3.         The land bearing Survey No.03 adm. 7H 4R belonging to the

             appellants/claimants was acquired for the purpose of the Reservoir at

             village Ghogartala. The notification under Section 4 of the Land

             Acquisition Act, 1894 (for short, “the Act”) came to be published on 12 th

             December 1974. The award under Section 11 of the Act was declared on
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2nd February 1976. The Land Acquisition Officer awarded inadequate

compensation, being dissatisfied with the said compensation, the

claimants accepted the compensation under protest and sought reference

under Section 18 of the Land Acquisition Act for determination of the

proper market value of the acquired land. The claimants claimed

compensation @ Rs.8000/- per Acre. The learned Reference Court

enhanced the same to Rs.10,000/- per H (Rs.4000/- per Acre).

4.         Mr. Mundhe, learned counsel for the appellants claimants submits

that, in support of their claim, the claimants relied upon the sale

instances at Exhibits 20, 22, 24, 26 and 28. The learned Reference Court

considered the said sale instances and determined the market value of

the acquired land. While considering the sale instance at Exhibit 20, the

learned Reference Court applied excessive deduction of 20% on the

ground that the land covered under the said sale instance was a small

piece of land. He further submits that the sale instance at Exhibit 20

pertained to year 1971, whereas notification under Section 4 was

published in the year 1974, thus at least 10% escalation per year ought to

have been applied by the learned Reference Court.

5.         Per contra, Mr. Shinde, learned AGP for the respondent-State

supports the impugned order by contending that the learned Reference

Court has rightly applied 20% deduction towards the small size of the

land in sale instance at Exhibit 20 and further submits that no

interference is warranted with the impugned award for the purpose of
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granting enhancement.

6.         Having heard the learned counsel for the respective parties and

with their able assistance, upon going through the record and

proceedings, it is clear that the sale instance at Exhibit 20 pertains to the

land situated in the same village, bearing Survey No. 25/1. Under the

said sale transaction, one acre of land was sold for a consideration of

₹5,000/- (Rs.5000/- per Acre). However, the said sale instance is of the

year 1971, whereas the notification under Section 4 of the Land

Acquisition Act in the present case was published on 12 th December 1974.

While relying upon said sale instance below Exhibit 20, the learned

Reference Court applied 20% deduction towards small size of land sold

therein and thereby arriving at the market value of Rs.4000/- per Acre.

7.         The notification under Section 4 was published in the year 1974

whereas sale instance at Exhibit 20 is of the year 1971, thus in my

considered view, 10% escalation per year ought to have been granted for

two years with cumulative effect. After applying such escalation, the

market value of the acquired land would arrive at Rs.6000/- per Acre

(Rs.15,000/- per H). Therefore, I am inclined to grant compensation @

Rs.6000/- per Acre (Rs.15,000/- per H). Hence, I pass the following

order:

                                     ORDER

      I.       The First Appeal is partly allowed.

      II.      The appellants-original claimants shall be entitled to
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     compensation at the rate of ₹6,000/- per acre, i.e. ₹15,000/- per

     hectare, for the acquired land and to that extent impugned

     award stands modified.

     III.    The appellants-claimants shall also be entitled to all

     consequential statutory benefits, including interest under

     Sections 28 and 34 of the Act, as applicable, from the date of the

     award as per Full Bench judgment of this Court in State of

     Maharashtra v. Kailash Shiva Rangari, 2016 (3) Mh.L.J. 457.

     IV.    Rest of the award passed by the learned Reference Court

     stands confirmed.

     V.     Modified award be drawn accordingly.

     VI.    Deficit Court fee be paid.

     VII.   Pending Civil Applications, if any, stand disposed of.




                                          [ SIDDHESHWAR S. THOMBRE ]
                                                    JUDGE


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